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Bank Advisors Need To Concentrate On Building Trust With Customers

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B y Trevor Thomas


Bank customers dont want insurance products rammed down their throats, said Karen M. Kruse, senior vice president and manager of wealth management for First Tennessee National Corporation, Memphis, during the Financial Institutions Insurance Associations fall conference here.

What they do want from their banks financial advisors is someone they can trust, she said.

The advisor trying to sell insurance to a bank customer needs to overcome the clients doubt. For starters, that means being able to offer objective advice on a broad range of financial products, not just whole life insurance, said Kruse.

“Some insurance agents mistakenly believe that cash value life is the best solution for every financial need,” she added. “If youre a hammer, everything looks like a nail.”

Another speaker, Robert L. Nellson, principal and managing director of DeHayes Consulting Group, Ponte Vedra Beach, Fla., said bank advisors can build trust by keeping their ears open.

“You wont be credible until you gather a threshold amount of information on the customer,” Nellson said.

With more thorough information gathering, bank reps will find that customers are not only more likely to buy, but also to buy in higher volume and with greater frequency. And they will be prone to keep what they buy longer, said Nellson.

Many banks adopting the information-gathering model experience a three- to fourfold increase in profits, according to Nellson.

“Most of this increase occurs whether or not the information gathered is actually used to make a sales recommendation,” he observed.

Most bank financial advisors lack the training and tools needed to tackle the high end of the financial market, he said, adding that few are certified financial professionals and few use the full range of financial planning tools available to them.

Customers arent the only ones the bank advisor needs to win over, noted Kruse.

A sure route to higher sales is to build referrals from others in the bank, she said.

Cooperation and referrals from trust officers and other bank employees come to financial advisors who are easy to deal with, she added.

Bank colleagues will do business with reps whose style fits their own, Kruse added. They dont have to worry that such an advisor will scare their customers away.

“Loan officers are leery of screwing up relationships they have built over 20 years,” she said. “They need to be able to trust you, to feel confident that you can handle their valued customers.”

Another way to build referrals from colleagues in the bank is by providing them with fair compensation, Kruse added. For practical reasons, financial advisors need to repay those who refer their own customers–for example, through commission sharing or through reciprocal referrals from the advisors own customer base, she said.

Reproduced from National Underwriter Life & Health/Financial Services Edition, November 4, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.


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